Insurance Fraud NEWS
Insurers beefing up technology to counter growing fraud
December 05, 2016, Washington, DC
Tools deployed against cyber, auto scammers to help control premiums
Technology is a valued ally of insurers in combatting insurance fraud. And for good reason — this crime is growing.
These are two findings of the Coalition’s newest study of how insurers use tech to combat billions of dollars in fraud each year.
The study is one of the surest barometers of progress in how insurers wield technology against fraudsters. It’s also a window into scams that most concern property-casualty insurers, and how they’re responding.
Fraud is climbing, more than 60 percent of insurers say in the study. Cyber-fraud is a newer problem area that insurers are using tech tools to combat.
Technology is especially adept at helping uproot auto-insurance scams — long among the biggest losses inflicted on insurers. High auto premiums are an emotionally charged issue for many consumers. Analytics help keep auto premiums more in line by controlling bogus crash claims. This does a service to drivers who pay their premiums honestly.
Organized rings, crooked medical providers and drivers who falsely register vehicles in other locales to lower their auto premiums are priority schemes analytics play an important role in counting, the study shows.
Fraud-busting tech plays an ever-growing role for insurers. Tech seems to have turned the corner internally. Anti-fraud departments have done a good job of selling upper management on the business benefits of tech in helping stem large losses. Fraud fighters see less need to keep justifying tech, and fully one-third of insurers expect larger IT budgets in 2017.
Predictive analytics — which can forecast the likelihood of certain fraud crimes — continues rising as a star player. Powerful software also helps insurers automate detection of false claims, thus making fraud-busting faster and more-efficient than ever.
For all the gee-wiz headlines that cool tech breeds as a kind of new-era fraud-busting messiah, we should remember that tech tools are mostly buckets of code and data until humans make sense of the findings.
More to the point … fraud fighters also bring an unmatched 360-degree ability to size up fraud investigations from every angle — digital and street-level — to reach correct conclusions about claims. Nor am I aware of software programs grunting through a home’s blackened rubble for a possible insurance arson.
Analytics also are more than just hi-IQ data crunchers. Anti-fraud tech helps insurers serve the ultimate master: policyholders. Claims can get resolved faster and more accurately. Premiums are better controlled. Honest policyholders have a better experience, and fraudsters have a worse one. That’s what insurance should be all about.